Housing group says Greens' plan innovative

A community housing agency says the Green Party's proposal to allow state housing tenants to rent-to-buy their homes would help low-income families with dependent children into home ownership.

Under the Greens' plan, people could rent state houses and buy them by paying slightly more, without the need for a mortgage or a deposit.

Under the proposal, the Crown would build houses for up to $300,000 and rent them to families who could then choose to eventually buy them.

Green Party co-leader Metiria Turei said equity purchases would go towards the cost of building the houses, so there would be no impact on the Crown's net debt.

The policy also sets minimum standards for rental homes and changes tenancy laws to provide more security for tenants.

Major Campbell Roberts, director of the Salvation Army's social policy, says the Greens' plan is already being used successfully by some community organisations and believes many families would be able to afford it.

But Prime Minister John Key is knocking the plan, saying the Government is working to make more land available for building to improve housing affordability.

Labour Party leader David Shearer has given guarded support to the policy.

Labour's housing policy is aimed at building 100,000 thousand affordable homes in the next decade.

Mr Shearer says there is much in the Greens' policy that his party agrees with, but the cost of it needs to be looked at.

"There's some good ideas, but again it comes down to the economic management of that and whether the Government can afford it."

Mr Shearer says as Prime Minister, he would lead a financially responsible government so Labour would need to take a good look at the Greens' policy.